What Credit Score Do You Need for a Personal Loan in Canada?
There's No Single "Magic Number"
One of the most common questions we hear is: "What credit score do I need to get approved?" The honest answer is that it depends on where you apply. Different types of lenders have very different thresholds. In Canada, credit scores range from 300 to 900. Here's what the ranges generally mean:
| Score Range | Rating | Typical Lender Access |
|---|---|---|
| 800–900 | Excellent | Best rates at any lender |
| 720–799 | Very Good | Most banks and credit unions |
| 660–719 | Good | Banks, credit unions, online lenders |
| 600–659 | Fair | Online lenders, some credit unions |
| 550–599 | Poor | Alternative and subprime lenders |
| Below 550 | Very Poor | Specialized bad credit lenders |
Credit Score Requirements by Lender Type
Major Banks (TD, RBC, BMO, Scotia, CIBC)
Traditional banks typically want to see a score of 660 or higher for an unsecured personal loan. Some may approve at 620+ with a strong income and low debt-to-income ratio, but you'll pay a premium rate. Typical rates: 6.99% – 15% Best for: Borrowers with established credit and stable employment
Credit Unions
Credit unions like Interior Savings or Valley First are member-owned and sometimes more flexible than big banks. They may approve personal loans at 600+, and they're more willing to consider the full picture rather than just your score. Typical rates: 7% – 18% Best for: Members with a banking relationship and fair credit
Online Lenders
Fintech lenders and online lending platforms have disrupted traditional lending by using more sophisticated risk models. Many will consider applicants with scores as low as 550–600. Typical rates: 9% – 35% Best for: Borrowers who've been declined by banks and need a faster process
Subprime and Alternative Lenders
These lenders specialize in borrowers with poor credit. Some will consider applications with scores below 550, including borrowers with past bankruptcy or consumer proposal. Typical rates: 20% – 46.96% (the legal maximum in Canada) Best for: Rebuilding credit when other options aren't available
It's Not Just About the Number
Your credit score is the most visible factor, but lenders also evaluate:
- Income and employment — Stable employment or consistent income from any source (self-employment, pension, disability) is often more important than a perfect score.
- Debt-to-income ratio — If your existing monthly debt payments eat up more than 40% of your gross income, lenders get nervous regardless of your score.
- Credit history length — A 620 score with 10 years of history looks different than a 620 with only 2 years.
- Recent credit behaviour — Lenders weigh recent activity more heavily. Six months of perfect payments can offset older problems.
- Loan amount and purpose — Smaller amounts are easier to get approved for. Some lenders offer more favourable terms for debt consolidation because it reduces your overall risk.
What If Your Score Is Too Low?
If you've been declined, you have options:
Apply With a Co-Signer
A co-signer with good credit can dramatically improve your approval odds and rate. The co-signer is equally responsible for repayment, so choose someone who trusts you — and don't let them down.
Start With a Secured Loan or Credit Builder
Some lenders offer secured personal loans (backed by a deposit) or dedicated credit-builder products. These are designed to help you build or rebuild your score.
Reduce Existing Debt First
Paying down credit card balances is the fastest way to move your score. Even reducing utilization from 80% to 30% can boost your score by 30–50 points within one billing cycle.
Try a Different Lender
Each lender has different criteria. Being declined at one doesn't mean you'll be declined everywhere. Comparison platforms let you see multiple options without multiple hard credit checks.
How to Check Your Score for Free
Before applying anywhere, know your score:
- Borrowell — Free weekly Equifax score updates
- Credit Karma Canada — Free TransUnion score monitoring
- Equifax and TransUnion — Free annual report by mail, or paid instant access Checking your own score is always a soft inquiry and never affects your score.
The Bottom Line
There is no universal minimum credit score for a personal loan in Canada. Your score determines which lenders you can access and what rate you'll pay — but it's not the only factor. Income, debt load, and recent credit behaviour all matter. The best approach is to compare multiple lenders at once. Our free comparison tool matches you with lenders based on your full profile, not just your score. It takes 2 minutes and uses a soft check that won't affect your credit.
Watch: Soft Credit Check Explained — Will Applying Hurt My Score? (60 seconds)
Watch: 5 Things Your Lender Must Tell You by Law (60 seconds)
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